- 13 - before submission of these cases. Petitioners have stipulated that the portion of the EWA proceeds that was paid over to Western General “was * * * properly included in [petitioners’] income over the terms of the EWA in accordance with Revenue Procedure 92-98". (Emphasis added.) Second, to the extent there is any conceivable ambiguity in this stipulation (and we do not suggest that there is), we believe that respondent is correct that he did not receive “fair warning” of petitioners’ intention to raise any issue concerning income inclusion. As a pleading, the petition has as its purpose “to give the parties and the Court fair notice of the matters in controversy”. Rule 31(a). Generally speaking, issues not raised in the assignments of error in the petition are deemed conceded. See Rule 34(b)(4). Whether issues not raised in the pleadings will nonetheless be considered is a matter for the Court’s discretion, taking into account the prejudice to the opposing party. The rule that a party may not raise a new issue on brief is not absolute. Rather, it is founded upon the exercise of judicial discretion in determining whether considerations of surprise and prejudice require that a party be protected from having to face a belated confrontation which precludes or limits that party’s opportunity to present pertinent evidence. * * * [Ware v. Commissioner, 92 T.C. 1267, 1268 (1989), affd. 906 F.2d 62 (2d Cir. 1990).] It is clear that petitioners did not provide notice in their petitions of an intention to contest the inclusion in income of the amounts paid to Western General. The error alleged in thePage: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
Last modified: May 25, 2011